Borrowing against Property owened/held in a California Bypass Trust.
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Borrowing against Property owened/held in a California Bypass Trust.
I am one of the beneficiaries of a California By-Pass trust, my Mother is still alive. There is property in Texas fully paid for and held in the trust. I would like to borrow against it for a down payment on a house in California as a first time home buyer, can this be done?
Asked on July 1, 2009 under Real Estate Law, California
Answers:
Neal Rimer / Neal M. Rimer, Esquire
Answered 15 years ago | Contributor
Generally, only an "owner" can borrow money secured with real property. You are not the owner.. the Trustee of the trust is the owner for the benefit of the beneficiaries... of which you are one.
If you want to borrow money from the Trustee, you should be able to do that. Just ask. It is usually up to the Trustee to decide if they desire to make a loan to you, whether secured or unsecured.
The issue is not that the property in Texas is free and clear of liens, the issue is dealing with the desire of the Trustee to be a lender to you.
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